# Question about Heartland Credit Card "Discount Rate&quo

A rep from Heartland keeps coming down and wants me to switch over. This time he left a contract for me to look at and it states:
Visa/MC Discount Rate 60% Trans Fee Dial 6.5 cents.

I know the 6.5 cents is Heartlands fee for each swipe of a credit card, but what is the 60% Discount rate?

Also, this is for a 3 year contract. No annual fee. and a Monthly service charge of \$15

How is this comparing with the rest of you?

Thanks again all!

Re: Question about Heartland Credit Card "Discount Rate

Does it say 0.60% or 60%?

0.60% is probably what it is. This would be 60 Basis Points above cost.

Basis Point Explanation 1.00% = 100 Basis Points
another way to look at it is 6 cents per \$10 processed.

example: \$30 Signature Check Card Transaction will breakdown as follows

\$30 x 1.03% + 15cents + 0.0925% (Cost(Interchange and Assessment) owed to the Issuing Bank and VISA) = 48.67 cents
PLUS \$30 x 60 Basis Points = 18 cents Plus 6.5 cents-----> 24.5 cents (Processor Charge to handle the money)

Total Charge = 73.17 cents for an effective rate of 2.5%
Check Cards should have an effective rate closer to 2.1% or lower

60 Basis Points above cost is NOT very competitive. You can do better from your existing provider, if not I can do better for you.

Re: Question about Heartland Credit Card "Discount Rate

it does say 60% not .60 but this guy may not know what is going on so… :roll:

i’m going to give him a call and double check what he’s got written here… anything perticular I should ask other then about the 60?

Thanks much!

Re: Question about Heartland Credit Card "Discount Rate

I would ask if it is “TRUE” cost plus.

If your doing any type of volume why \$15/month statement fee (sounds kinda high assuming your volume is good)

Let me know if you have other ???

Re: Question about Heartland Credit Card "Discount Rate

I’ll give him a call and let you know what he says after I decipher his ramblings

:lol:

Thanks!

Re: Question about Heartland Credit Card "Discount Rate

OK, here’s the scoop.

The “discount rate” IS .6% for Visa/MC
And the “Trans Fee” @ \$.065 is broken down as \$.045 to Visa/MC/Amex/Discover and \$.02 to Heartland

His main concern is getting the overall fee’s (everything from card swipes to batch fees (if there are any) to mo. service charges and so on) down to under 3%, between 2.8-2.9% (which is said he would put in the contract).

With my current processor (NorthAmerican Bancard) he looked at my average statements and figured up that Iâ€™m paying around 5.75%

I’ve never heard of a place that goes by overall %. Is this guy crazy or what?

Thanks again!

Re: Question about Heartland Credit Card "Discount Rate

Scott, What is considered a good volume

Re: Question about Heartland Credit Card "Discount Rate

btw, we average \$6-8k a mo. in card sales

Re: Question about Heartland Credit Card "Discount Rate

RedBarn,

Anything above 5K per month we have the ability to adjust certain fees. ANything less than 5K we have to abide by a strict pricing structure.

Re: Question about Heartland Credit Card "Discount Rate

He’s not necessarily “crazy”. Effective (Overall) Rate is used as a barometer to quickly determine if a processor is capable of saving you money. Depending upon average ticket, an acceptable Effective Rate would be anywhere from 2.1% up to 3.2%.

A higher average ticket will typically have a lower effective rate and visaversa for Low Avg Tickets.

Re: Question about Heartland Credit Card "Discount Rate

He figured up that i’m getting 5.75% from my current place…
I’d like to double check his figures.

Do I just add up every single fee on my statement and compare that to the overall Sales?

Here is what I have off of a statement.

Total Sales \$7359.55
Discount \$159.34
Varience: \$.54
Net Deposit: \$7200.21
Surcharges: \$75.47
Other Fees: \$97.23

So, i figure
Total Sales \$7359.55
Total Fees \$332.58
Thus 4.5% which is’nt as high as his 5.75% but still
My ave. ticket for this month is \$23.10

## Correct?

Also, for everyone wondering what all the “fees” include, heres a quick breakdown of what i got here
----------Discout: Includes---------
Disc Rate item Rate
Visa 1.59% \$ .10
Vibs 1.59% \$ .10
Vdbt 1.59% \$ .15
Visp 1.59% \$ .10
MC 1.59% \$ .10
MCbs 1.59% \$ .10
MCbt 1.59% \$ .15
MCwc 1.59% \$ .10
MCec 1.59% \$ .10
For a total of \$159.34

---------Surcharges------------
Non-qualified \$36.77
Mid-qualified \$38.70
For a total of \$75.47

------------Other Fees------------
Rate
AMEX \$.25
DISC \$.25
VISA \$.19
MC \$.19
For a total of \$97.23

that’s it.

Re: Question about Heartland Credit Card "Discount Rate

We just started taking cards. If the % of sales we are doing on cards now is any indication, we will do about 200K per year on cards.

We went with Heartland, so will come back and post what the effective rate is as we get the monthly bills.

Our average sale is about \$35 in the winter and maybe \$26-28 in the summer. Card not present about about 70% of the time.

Re: Question about Heartland Credit Card "Discount Rate

RBSLynkman, are your rates comparable to what I posted above?

Re: Question about Heartland Credit Card "Discount Rate

Actually, based upon what you have listed, I can probably offer you better rates.
Either on a Cost Plus program or on a 4 Tier Pricing program.

I will recomend either one or the other depending upon which one will save you the most amount of money.

Since every merchant in different and rates are custom I can’t list the rates on this site.

Please BlackOut any sensitive information on your statement (deposit account and Merchant Number) I ask this so you will feel compfortable sending me your information.

My fax number is 512-287-4876